Digital Realty Trust Inc. (DLR): Today's Featured Real Estate Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model

Digital Realty ( DLR) pushed the Real Estate industry lower today making it today's featured Real Estate laggard. The industry as a whole closed the day up 0.5%. By the end of trading, Digital Realty fell $1.27 (-1.9%) to $65.45 on average volume. Throughout the day, 1,632,028 shares of Digital Realty exchanged hands as compared to its average daily volume of 1,462,500 shares. The stock ranged in price between $65.15-$66.99 after having opened the day at $66.88 as compared to the previous trading day's close of $66.72. Other companies within the Real Estate industry that declined today were: Transcontinental Realty Investors ( TCI), down 15.2%, Vestin Realty Mortgage I ( VRTA), down 6.9%, Optibase ( OBAS), down 5.4% and Trade Street Residential ( TSRE), down 4.5%.
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Digital Realty Trust, Inc., a real estate investment trust (REIT), through its controlling interest in Digital Realty Trust, L.P., engages in the ownership, acquisition, development, redevelopment, and management of technology-related real estate. Digital Realty has a market cap of $8.4 billion and is part of the financial sector. The company has a P/E ratio of 44.9, above the S&P 500 P/E ratio of 17.7. Shares are down 1.7% year to date as of the close of trading on Monday. Currently there are 7 analysts that rate Digital Realty a buy, 1 analyst rates it a sell, and 7 rate it a hold.

TheStreet Ratings rates Digital Realty as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, reasonable valuation levels and increase in net income. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

On the positive front, China Housing & Land Development ( CHLN), down 14.7%, Capital ( CT), down 10.0%, Blackstone Mortgate ( BXMT), down 10.0% and Maui Land & Pineapple Company ( MLP), down 6.9% , were all gainers within the real estate industry with Weyerhaeuser ( WY) being today's featured real estate industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the real estate industry could consider iShares Dow Jones US Real Estate ( IYR) while those bearish on the real estate industry could consider ProShares Short Real Estate Fund ( REK).

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